The Madoff syndrome | NevadaAppeal.com

The Madoff syndrome

Guy W. Farmer
Special to the Appeal

The poster boy for Wall Street greed and self-ishness is 70-year-old financier and money

manager Bernard Madoff, who scammed at least $50 billion (with a “b”) from wealthy ” and formerly wealthy ” investors including members of his own family. What a guy!

Madoff, once known as “the Jewish T-bill” for his ability to generate big returns on investments, was secretly conducting a clever “Ponzi” scheme to victimize those same friends until his two sons went to authorities when they learned that their father was ripping-off unsuspecting investors. I agree with Washington Post columnist Jim Hoagland, who wrote that “the younger Madoffs’ reactions and emotions might tell us a lot about a huge problem the entire world now confronts.

“That problem is the awakening of the world’s youth to the raw deal their parents and grandparents … are handing them, and the growing anger the young feel about the fetid stables of debt, scandal and corruption they are being left to clean,” Hoagland continued. “We have taken the greatest financial, technological and political opportunities the world has ever offered and abused them for our own pleasure, greed and egos. We read about Bernie Madoff so avidly because deep down, Bernie is one of us. He got what he could while he could.”

Tough language, but true. Because, as Hoagland wrote, “Bernie was one of all of us who refused to vote for politicians who would raise our taxes and make the nation live within its means, even as we went to war.” Does any of this sound familiar as the Nevada Legislature convenes to resolve the huge budget deficits that face our state? Attempting to deliver on his “no new taxes” pledge, Gov. Jim Gibbons has proposed a “temporary” 6 percent reduction in state employees’ salaries and draconian cuts to higher education. So much for his “education first” pledge.

My loyal readers should usually disregard what I write about economics because I know so little about the “dismal science.” In this case, however, I’ll beg your indulgence on grounds that even I recognize that many Americans have been living beyond their means ” buying everything on credit, spending more than they earn and signing mortgages they couldn’t afford. And now they’re asking Uncle Sam to bail them out by rescuing them from their own bad judgment. Brilliant.

But I suppose that a government that can hand out billions of taxpayer dollars to failing banks and car companies can distribute billions more to those same taxpayers. After all, it’s our money. My only question is whether the government can print money fast enough to pay for President Obama’s trillion-dollar economic stimulus plan. This is Big Government writ large, and both major parties are playing a dangerous game as we plunge deeper and deeper into a full-blown recession.

Obama’s Economic Czar, former Treasury Secretary Larry Summers, says we now face the bleakest economic outlook since World War II and argues for a trillion-dollar economic stimulus plan designed to create three million new jobs by investing in long-overdue infrastructure projects (roads, bridges etc.) renewable energy initiatives and public education.

“We must measure progress not by the agendas of (special) interest groups but by whether the American people experience results,” he wrote. Amen.

Let’s be clear that investing means spending, and that Obama’s spending proposals will require additional revenue sources ” taxes, that is. Although the no-taxers will scream bloody murder, I think they’re a noisy minority. In my opinion, most Americans are willing to do their fair share if the economic burdens are spread equitably.

Another Washington Post columnist, Eugene Robinson, wrote that we will eventually thank Bernie Madoff “for giving us the simplest possible explanation of what we knew all along but chose to ignore: That there’s still no such thing as a free lunch.” Thank you, Bernie.

– Guy W. Farmer, a Carson City taxpayer, is a semi-retired journalist and former U.S. diplomat.